New Proposed Regulations Expand CFIUS Jurisdiction Regarding Real Estate
January 20, 2020 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogOn September 17, 2019, the U.S. Department of Treasury issued two new proposed rules for the Committee on Foreign Investment in the United States (CFIUS) implementing the Foreign Investment Risk Review Modernization Act (FIRRMA). Of particular interest to readers of this blog was the second of the proposed rules, which addressed FIRRMA’s real estate-related expansion of CFIUS jurisdiction.
Pillsbury's Construction & Real Estate Law Team
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Nevada’s Home Building Industry can Breathe Easier: No Action on SB250 Leaves Current Attorney’s Fees Provision Intact
June 21, 2017 —
Aaron Lovaas – Newmeyer & Dillion LLPConstruction and design professionals in Nevada’s home building industry breathed a collective sigh of relief on June 5, 2017 when the 79th Session of the Nevada Legislature adjourned without entertaining Senate Bill 250, which sought to reinstate homeowner plaintiffs’ nearly automatic right to recover attorneys’ fees, expert costs, and costs of investigation when bringing suit for alleged constructional defects.
Until 2015, homeowners’ recovery of such damages was the reality of the construction defect landscape in Nevada. While Chapter 40 of the Nevada Revised Statutes specifically allowed for recovery of “reasonable” attorneys’ fees, expert costs, and costs of investigation, the trend in Nevada was that plaintiffs were all but guaranteed awards of all such sums. Of course, this environment incentivized plaintiffs’ lawyers to bring claims of questionable or little repair value in cases where the attorney’s fees and expert costs often far exceeded the costs of repair.
HOW AB125 CHANGED THE LANDSCAPE
Such was the reality in Nevada until 2015 and the passage of Assembly Bill 125, which eliminated the nearly automatic award of attorneys’ fees and expert costs and overhauled Chapter 40 in many other respects. AB125 made over portions of Chapter 40 by:
- Placing awards of attorneys’ fees into the framework of offers of judgment, utilized extensively in other fields of civil litigation and available equally to homeowner plaintiffs as well as construction industry defendants; and
- Reworking expert costs and costs of investigation to allow for the award of those items only in the case of proven defects and only as to those costs directly related to the investigation and proof of those defects.
INTRODUCING SB250
The 2017 Legislative Session saw efforts to return Chapter 40 to its pre-2015 version through the introduction of SB250. Fortunately for construction and design professionals in the home building industry in Nevada, the State Senate Judiciary Committee did not act upon the bill and the effort died having never made it to a floor vote. Considering that Nevada’s Legislature meets biannually, the current framework of Chapter 40 is intact until at least 2019. The 2017 Legislative Session, however, is an illustration to how quickly those of the construction defect plaintiffs’ bar can move to initiate efforts to turn back the clock to a much riskier time for construction and design professionals.
Those in the industry should remain vigilant and monitor future legislative efforts to reinstate such awards or other clearly anti-builder measures. Such measures simply drive-up the overall cost and expense of home construction and, in turn, home ownership, which it is often said, is one of the cornerstones of the American dream.
Aaron Lovaas is a partner in the Las Vegas office of Newmeyer & Dillion. As a transactional attorney and business litigator, Aaron has the ability to evaluate legal issues from both points of view and help his clients understand their best option. He can be reached at aaron.lovaas@ndlf.com.
About Newmeyer & Dillion
For more than 30 years, Newmeyer & Dillion has delivered creative and outstanding legal solutions and trial results for a wide array of clients. With over 70 attorneys practicing in all aspects of business, employment, real estate, construction and insurance law, Newmeyer & Dillion delivers legal services tailored to meet each client’s needs. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer & Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949-854-7000 or visit www.ndlf.com.
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Connecticut Civil Engineers Give the State's Infrastructure a "C" Grade
October 10, 2022 —
The American Society of Civil EngineersWATERBURY, CT. — The Connecticut Section of the American Society of Civil Engineers (ASCE) released the 2022 Report Card for Connecticut's Infrastructure today, with five categories of infrastructure receiving an overall grade of a 'C'. That means Connecticut's infrastructure is in mediocre condition, an improvement over the 'C-' grade issued in the 2018 report card. The bump is thanks in large part to improved condition of assets across several categories and additional funding allocated for roads, bridges and rail. Connecticut is also set to receive more than $5 billion from the federal bipartisan infrastructure bill, which was passed in late 2021. However, these improvements are threatened by Connecticut's aging infrastructure – one of the oldest infrastructure networks in the U.S. – and the recent suspension of the state's already-insufficient gas tax. Civil engineers graded bridges (C), drinking water (C), rail (B), roads (D+), and wastewater (C-).
"This Infrastructure Report Card shows that while Connecticut has made great progress, much more needs to be done to rebuild our state's roads and bridges and deliver essential services like clean drinking water," said U.S. Senator Richard Blumenthal. "President Biden's historic Bipartisan Infrastructure Law is expected to invest more than $5 billion in Connecticut's infrastructure and create thousands of good paying jobs for the workforce. These federal funds, along with critically increased job training resources, will help address the challenges outlined in the Report Card. I thank the Connecticut Society of Civil Engineers for their commitment to designing and building our infrastructure, as well as all of the workers who innovate and advance the systems and structures we rely on every day."
To view the report card and all five categories, visit https://infrastructurereportcard.org/state-item/connecticut/.
ABOUT THE AMERICAN SOCIETY OF CIVIL ENGINEERS
Founded in 1852, the American Society of Civil Engineers represents more than 150,000 civil engineers worldwide and is America's oldest national engineering society. ASCE works to raise awareness of the need to maintain and modernize the nation's infrastructure using sustainable and resilient practices, advocates for increasing and optimizing investment in infrastructure, and improve engineering knowledge and competency. For more information, visit www.asce.org or www.infrastructurereportcard.org and follow us on Twitter, @ASCETweets and @ASCEGovRel.
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Senate Committee Approves Military Construction Funds
June 29, 2011 —
CDJ STAFFWith a decrease in funding, as compared to the House bill, the Military Construction and Veteran’s Affairs subcommittee of the Senate moved on a $72 billion construction bill. The House version had approved an additional half billion dollars in funding. Senator Tim Johnson, Democrat of South Carolina, said that he expected easy reconciliation with the House version. The Senate bill will move to the full Senate Appropriations Committee on June 30.
The bill, S 1255, includes funding for construction and remodeling of military housing, as well as construction and remodeling of base facilities.
Read the full story… Read S1255
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Builder’s Be Wary of Insurance Policies that Provide No Coverage for Building: Mt. Hawley Ins. Co v. Creek Side at Parker HOA
May 01, 2014 —
David M. McLain – Higgins, Hopkins, McLain & Roswell, LLCOn the heels of a recent order regarding coverage under a Comprehensive General Insurance policy issued by Mt. Hawley Insurance Company (“Mt. Hawley”), builders should be very wary of CGL policies providing no coverage for property damage.
On January 8, 2013, District Court Judge R. Brooke Jackson granted a motion for declaratory judgment filed by Mt. Hawley. The order states that the subject insurance policies issued by Mt. Hawley to Mountain View Homes II, LLC (“MV Homes”), the builder developer of the Creek Side at Parker development (the “Project”), did not provide coverage for any of the work performed by MV Homes or its subcontractors on the Project.
MV Homes originally began construction on the Project in 2002 and completed construction in 2005. MV Homes was insured by National Fire and Marine Insurance Company (“National Fire”) and Mt. Hawley. In December 2008, Creek Side at Parker Homeowners Association, Inc. (“the HOA”) served notice on MV Homes. The HOA then instituted a construction defect lawsuit on June 1, 2009 against MV Homes and others. MV Homes initially demanded a defense and indemnity from National Fire, which provided a defense. Then, after two years, MV Homes demanded a defense and indemnity from Mt. Hawley in July 2011. Mt. Hawley denied coverage and did not provide a defense. The case was settled soon after, and National Fire reserved or assigned claims against Mt. Hawley.
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David M. McLain, Higgins, Hopkins, McLain & Roswell, LLCMr. McLain may be contacted at
mclain@hhmrlaw.com
Break out the Neon: ‘80s Era Davis-Bacon “Prevailing Wage” Definition Restored in DOL Final Rule
August 21, 2023 —
A. Scott Hecker & Ted North - The Construction SeytOn August 8, 2023, the U.S. Department of Labor (DOL)
announced its
final rule related to the Davis-Bacon Act (the “Act”), entitled “Updating the Davis-Bacon and Related Acts Regulations.” However, the official final rule must be published in the Federal Register – likely by week’s end – before going into effect 60 days after publication.
DOL issued its notice of proposed rulemaking (“NPRM”) in March 2022 and received more than 40,000 comments from interested stakeholders. Evaluating and addressing those comments took the better part of a year, as DOL did not send the rule to the Office of Information and Regulatory Affairs (“OIRA”) for White House approval until December 16, 2022. After languishing for months, OIRA has now concluded its review, allowing DOL to move forward with its final rule.
Reprinted courtesy of
A. Scott Hecker, Seyfarth and
Ted North, Seyfarth
Mr. Hecker may be contacted at shecker@seyfarth.com
Mr. North may be contacted at enorth@seyfarth.com
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Sinking Buildings on the Rise?
July 01, 2019 —
Jason M. Adams - Gibbs GidenBy now everyone in the construction and insurance industries is familiar with the 58-story Millennium Tower building in San Francisco that has sunk 17 inches and tilted another 14 inches to the northwest. Another recent New York lawsuit alleges that a 58-story luxury Manhattan condo high-rise is also sinking and causing significant damage. With construction booming in the Southeast and other areas with questionable soils, sinking building cases may be on the rise. Given this reality, the issue of subsidence should be of paramount importance to every construction and insurance professional when insuring a project.
Most insurance carriers will include a subsidence and/or other earth movement exclusion on a commercial general liability ("CGL") quote for insurance as a matter of course. Construction professionals (owners/developers, general contractors, and subcontractors) or their brokers may be under the mistaken impression that they have no choice but to accept these subsidence exclusions as part of a standard construction policy. This is not the case. To the contrary, most insurance carriers are willing to remove subsidence exclusions if the underwriters are provided with acceptable geotechnical/soils reports when considering the project.
The insured construction professional often pushes back on the insurance carrier's request for soils reports because the insured sees the request as an unnecessary hassle, expense or unwelcome interference in the job. However, the carrier's soils review is designed to benefit everyone. If potential soils issues are discovered during the underwriting process they can be addressed at the outset of the project rather than after the project is built, which will typically cost substantially more to remedy. Moreover, a thorough analysis of the condition of the soils at the outset of the project allows the risk management team to recognize any potential issues and ensure that the proper coverage is obtained in order to provide protection down the road. Even if the insurance carrier charges more money to sign off on questionable soils after a review of the reports, the slight increase in premium is likely a worthwhile investment in the event of a subsidence loss.
The lesson is that the insured should not blindly accept a subsidence exclusion and should negotiate its removal. The insured should provide its broker and the insurance carrier the information they need in order to make a fully-informed decision as it pertains to the soils. Once the insurance carrier has had the opportunity to review and sign off on the condition of the soil, the carrier should feel comfortable enough to remove any subsidence exclusions or other similar earth movement limitations.
Subsidence is a relatively straightforward issue to deal with as long as the project team’s lawyers, brokers, risk managers and insurance company underwriters are working together toward the common goal of properly evaluating the risk and adequately insuring the project. This simple cooperative process between the entire risk management team could mean the difference between being covered or not covered in the event of a loss related to earth movement.
Jason M. Adams, Esq. is Senior Counsel at Gibbs Giden representing construction professionals (owners/developers, contractors, architects, etc.) in the areas of Construction Law, Insurance Law and Risk Management, Common Interest Community Law (HOA) and Civil Litigation. Adams is also a licensed property and casualty insurance broker and certified Construction Risk & Insurance Specialist (CRIS). Gibbs Giden is nationally and locally recognized by U. S. News and Best Lawyers as among the “Best Law Firms” in both Construction Law and Construction Litigation. Chambers USA Directory of Leading Lawyers has consistently recognized Gibbs Giden as among California’s elite construction law firms. Mr. Adams can be reached at jadams@gibbsgiden.com.
The content contained herein is published online for informational purposes only, may not reflect the most current legal developments, verdicts or settlements, and does not constitute legal advice. Do not act on the information contained herein without seeking the advice of licensed counsel. The transmission of information by email, or any transmission or exchange of information over the Internet, or by any of the included links is not intended to create and does not constitute an attorney-client relationship. This publication may not be reproduced or used in whole or in part without written consent of the author. Copyright 2019 ©
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Another Law Will Increase Construction Costs in New York
May 29, 2023 —
Bill Wilson - Construction Law ZoneNew York recently enacted legislation known as Carlos’ Law, which increases penalties for corporate liability for the death of, or serious injury to, an employee. The bill, S.621B / A.4947B, was named after Carlos Moncayo, a construction worker killed in a trench collapse on a New York City construction project. Moncayo’s employer repeatedly flouted safety rules and ignored warnings of dangerous conditions on its construction site before failing to properly support the trench that collapsed and killed Moncayo. Moncayo’s employer was convicted for his death, but the penalty was light. The company was sentenced to pay only $10,000, the maximum penalty at the time for any company convicted of a felony in New York State. The legislature responded with Carlos’ Law, which increases accountability for “employers,” and expands the scope of “employees” covered.
The corporate criminal law, NY Penal § 20.20(2)(c)(iv), imposes liability on an employer when “the conduct constituting the offense is engaged in by an agent of the corporation while acting within the scope of his employment and on behalf of the corporation, and the offense is . . . in relation to a crime involving the death or serious physical injury of an employee where the corporation acted negligently, recklessly, intentionally, or knowingly.” An “agent” of an employer is any “director, officer or employee of a corporation, or any other person who is authorized to act on behalf of the corporation.” § 20.20(a). An “employee” now includes any person providing labor or services for remuneration for a private entity or business within New York State without regard to an individual’s immigration status, and includes part-time workers, independent contractors, apprentices, day laborers and other workers. § 10.00 (22). The penalties for criminal corporate liability for the death or serious injury of an employee now include maximums of $500,000 when centered on a felony, and $300,000 when centered on a misdemeanor. § 80.10(1)(a) and (b).
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Bill Wilson, Robinson & Cole LLPMr. Wilson may be contacted at
wwilson@rc.com
